UAE national airline Etihad Airways has reported a record result exceeding its 2011 target of breaking even, with a full year Ebit of $137 million.
Revenues were higher by 36.0 per cent to reach $4.1 billion (2010: $2.98bn), the Abu Dhabi-based carrier said in a statement.
The results included earnings before interest, tax, depreciation, amortisation and rentals (Ebitdar) of $648m, with a net profit of $14m, the statement added.
James Hogan, President and Chief Executive Officer of Etihad Airways, stated, “This is an historic day for Etihad Airways and an amazing achievement for an airline just eight years old. Five years ago we said we would be profitable by 2011. Despite the global financial crisis, continued high oil prices, regional instability and natural disasters, we have delivered."
“And we will aim for strong growth again in 2012, in spite of the tough global economic environment, with a passenger traffic target of 10 million and a corresponding increase in profits,” Mr Hogan added.
Etihad posted growth in passengers by 17 per cent, reaching 8.3 million from 7.1 million in 2010.
The average seat factor of 75.8 per cent, nearly two percentage points was higher than 2010, which achieved 74.0 per cent.
The airline added five new routes in 2011 with Bangalore, the Maldives, the Seychelles, Chengdu and Düsseldorf.
Meanwhile, Etihad Crystal Cargo revenues rose 25.7 per cent to $651m compared with $518m on tonnage, which was up 17.8 per cent to 310,188 tonnes.
Eight new codeshare agreements took Etihad to 35 airlines partners, which increased its worldwide network to 259 destinations.
Hogan said its successful deal with airberlin in December 2011 was a game changing move for Etihad, adding 157 destinations and giving access to 35 million new passengers.
Mr Hogan said the airberlin deal will be the airline's most important catalyst for growth in 2012, as it gives instant access to Europe’s largest travel market and will have a major impact on revenues in 2012, with an expected contribution of up to $50m.
“And of course, 2011 marked the first full year of Etihad Airways’ strategic partnership with Virgin Australia, which offers 45 destinations in Australia and the Pacific, and boosted revenue by 700 per cent over what we achieved with our previous Australian airline partner.
“We will continue to look at opportunities in 2012. Already this year we have announced a second equity investment, in Air Seychelles, which is an important step towards growing our operations in the increasingly popular leisure markets of the Indian Ocean and Africa.”
Mr Hogan said cost control had been a significant contributor to the airline’s profit, with costs per available seat kilometre (CASK), excluding fuel, being cut by 4.6 per cent in 2011 and 16.6 per cent over the last two years, representing annual savings of more than $187m.
“While we deliver an exceptional full service product, our management culture is that of a low cost airline. We have a forensic focus on cost control in every area of the business, aggressively targeting operational efficiencies.”
The airline also continued its policy of fuel hedging, which has protected the airline from the volatility of oil prices. More than 80 per cent of fuel costs were hedged in 2011, while the figure for 2012 is currently 75 per cent.
“We remain a business that is investing heavily in new routes, in new aircraft and in new infrastructure,” said Mr Hogan. “In 2012, we will add seven aircraft and have already announced plans to extend our network in Asia and Africa.”
This year, the airline commenced operations to Tripoli, and Shanghai and eyes to launch flights to Nairobi in the first quarter, while Lagos service will be offered in July.
Etihad Airways ordered 100 new aircraft and 105 options and purchase rights at the 2008 Farnborough Air Show. This gives flexibility in its network growth, enabling it to meet passenger demand over the next 10 years. To date, Etihad Airways has raised $5bn in external fleet financing, through a portfolio of 41 different financial institutions.
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